SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For Quarterly Period Ended September 30, 2001

Commission File Number 1-6798

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TRANSAMERICA FINANCE CORPORATION(Exact name of registrant as specified
in its charter)

|Delaware                        | 95-1077235         
|------------------------------- | -------------------
|(State or other jurisdiction of | (I.R.S. Employer   
|incorporation or organization)  | Identification No.)

9399 West Higgins RoadRosemont, Illinois 60018
(Address of principal executive offices) (Zip Code)

(847) 685-1100(Registrants telephone number, including area code)

Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 3 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X]    No [  ]

Number of shares of Common Stock, $10
par value, outstanding as of close of business on November 8, 2001: 1,464,285.



TRANSAMERICA FINANCE CORPORATION

FORM 10-Q

Part I. Financial Information

Item 1. Financial Statements

The following unaudited
consolidated financial statements of Transamerica Finance Corporation and its
subsidiaries (the Company) for the periods ended September 30, 2001
and 2000, do not include complete financial information and should be read in
conjunction with the Consolidated Financial Statements filed with the Commission
on Form 10-K for the year ended December 31, 2000. The financial information
presented in the financial statements included in this report reflects all
adjustments, consisting only of normal recurring accruals, which are, in the
opinion of management, necessary for a fair statement of results for the interim
periods presented. Results for the interim periods are not necessarily
indicative of the results that may be expected for the entire year.

* * * * *

On July 21, 1999,
Transamerica Corporation, which owns all of the Companys outstanding
common stock, completed its merger with a subsidiary of AEGON N. V. (AEGON), a
Netherlands based international insurance company. As a result, the Company is
now an indirect subsidiary of AEGON.

In 2000, the Company
determined that certain of its businesses did not fit its long-term strategy. As
a result of this determination, the Company reclassified certain assets to
assets held for sale. The Company also identified certain other assets as
liquidating and retained those assets in finance receivables. The ultimate
disposition of these assets will be based on maximizing value for AEGON. At
September 30, 2001, $394.3 million of the Companys net finance receivables
and equipment held for lease, net of a valuation allowance of $123.0 million,
were classified as assets held for sale and $426.3 million of the Companys
net finance receivables were identified as liquidating. Due to a softer market
caused by a downturn in the economy, managements ability to dispose of
these assets may be delayed.

As a result of the September
11, 2001 terrorist attacks on the World Trade Center and the Pentagon, the
aerospace industry is experiencing adverse changes to, and reductions in, its
commercial operations. The commercial lending operations aircraft
portfolio represents $381 million (5%) of the net finance receivables
outstanding at September 30, 2001. The portfolio is largely comprised of
aircraft with long remaining useful lives and broad user bases. Management is
continuing to review the portfolio for impairment, while also monitoring any
associated risks that exist relating to useful lives and changes in residual
values. Management believes that any future impairment of this portfolio should
not have a material impact on the companys financial position.

1

TRANSAMERICA FINANCE CORPORATIONCONSOLIDATED BALANCE SHEETS
(Dollar amounts in millions)

|                                                                | September 30,2001 |  | December 31,2000 |         
|--------------------------------------------------------------- | ----------------- |  | ---------------- | --------
|ASSETS                                                          |                   |  |                  |         
|Cash and cash equivalents                                       |                   |  | $                | 254.5   
|                                                                |                   | 
|Finance receivables                                             |                   |  |                  | 8,228.1 
|Less unearned finance charges                                   |                   |  |                  | 754.9   
|                                                                |                   |  |                  |         
|Net finance receivables                                         |                   |  |                  | 7,473.2 
|Less allowance for losses                                       |                   |  |                  | 155.9   
|                                                                |                   |  |                  |         
|                                                                |                   |  |                  | 7,317.3 
|Property and equipment, net of accumulated depreciation of      |                   | 
|$1,303.1 in 2001 and $1,205.1 in 2000:                          |                   | 
|Land, buildings and equipment                                   |                   |  |                  | 72.5    
|Equipment held for lease                                        |                   |  |                  | 1,858.3 
|Investments (cost of $71.7 in 2001 and $72.3 in 2000)           |                   |  |                  | 78.4    
|Goodwill, net of accumulated amortization of $197.8 in 2001 and |                   | 
|$186.5 in 2000                                                  |                   |  |                  | 310.0   
|Assets held for sale                                            |                   |  |                  | 394.3   
|Advances due from affiliates                                    |                   |  |                  | 93.2    
|Other assets                                                    |                   |  |                  | 534.3   
|                                                                |                   |  |                  |         
|                                                                |                   |  | $                | 10,912.8
|                                                                |                   |  |                  |         
|                                                                |                   | 
|LIABILITIES AND STOCKHOLDERS EQUITY                            |                   | 
|Debt:                                                           |                   | 
|Unsubordinated                                                  |                   |  | $                | 6,944.5 
|Subordinated                                                    |                   |  |                  | 60.5    
|Due to AEGON affiliates                                         |                   |  |                  | 650.0   
|                                                                |                   |  |                  |         
|Total debt                                                      |                   |  |                  | 7,655.0 
|Deferred real estate service revenues                           |                   |  |                  | 304.4   
|Accounts payable and other liabilities                          |                   |  |                  | 1,123.3 
|Income taxes payable                                            |                   |  |                  | 396.3   
|Stockholders equity:                                           |                   | 
|Preferred stockauthorized, 250,000 shares without par value;   |                   | 
|none issued                                                     |                   |  |                  |        
|Common stockauthorized, 2,500,000 shares of $10 par value;     |                   | 
|issued and outstanding, 1,464,285 shares                        |                   |  |                  | 14.6    
|Additional paid-in capital                                      |                   |  |                  | 1,403.5 
|Retained earnings                                               |                   |  |                  | 55.0    
|Accumulated other comprehensive loss                            |                   |  |                  | (39.3   
|                                                                |                   |  |                  |         
|Total stockholders equity                                      |                   |  |                  | 1,433.8 
|                                                                |                   |  |                  |         
|                                                                |                   |  | $                | 10,912.8
|                                                                |                   |  |                  |         

2

TRANSAMERICA FINANCE CORPORATIONCONSOLIDATED STATEMENTS OF INCOME
(Dollar amounts in millions)

|                                                               | Nine months endedSeptember 30, | Three months endedSeptember 30,
|-------------------------------------------------------------- | ------------------------------ | -------------------------------
|
|REVENUES                                                       |                                |                                
|Finance charges                                                |                                |                                
|Leasing revenues                                               |                                |                                
|Real estate service revenues                                   |                                |                                
|Other                                                          |                                |                                
|                                                               |                                |                                
|Total revenues                                                 |                                |                                
|                                                               |                                |                                
|EXPENSES                                                       |                                |                                
|Interest and debt expense                                      |                                |                                
|Depreciation on equipment held for lease                       |                                |                                
|Salaries and other operating expenses                          |                                |                                
|Provision for expected losses on disposal of business units    |                                |                                
|Provision for losses on receivables                            |                                |                                
|                                                               |                                |                                
|Total expenses                                                 |                                |                                
|Income (loss) before income taxes and cumulative effect of     |                                |                                
|accounting change                                              |                                |                                
|Income tax expense (benefit)                                   |                                |                                
|                                                               |                                |                                
|Income (loss) before cumulative effect of accounting change    |                                |                                
|Cumulative effect of accounting change (net of income taxes of |                                |                                
|$4.1)                                                          |                                |                                
|                                                               |                                |                                
|Net income (loss)                                              |                                |                                
|                                                               |                                |                                

3

TRANSAMERICA FINANCE CORPORATIONCONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollar amounts in millions)

|                                                            | Nine months endedSeptember 30,
|----------------------------------------------------------- | ------------------------------
|
|OPERATING ACTIVITIES                                        |                               
|Net income (loss)                                           |                               
|Adjustments to reconcile net income to net cash provided by |                               
|operating activities:                                       |                               
|Depreciation and amortization                               |                               
|Provision for losses on receivables                         |                               
|Provision for expected losses on disposal of assets of      |                               
|business units                                              |                               
|Change in accounts payable and other liabilities            |                               
|Change in income taxes payable                              |                               
|Other                                                       |                               
|                                                            |                               
|Net cash provided by operating activities                   |                               
|                                                            |                               
|INVESTING ACTIVITIES                                        |                               
|Finance receivables originated                              |                               
|Finance receivables collected and sold                      |                               
|Purchases of property and equipment                         |                               
|Sales of property and equipment                             |                               
|Proceeds from sale of certain assets held for sale          |                               
|Other                                                       |                               
|                                                            |                               
|Net cash provided by (used in) investing activities         |                               
|                                                            |                               
|FINANCING ACTIVITIES                                        |                               
|Proceeds from debt financing                                |                               
|Repayments of debt                                          |                               
|Proceeds from debt financing with AEGON affiliates          |                               
|Capital contributions                                       |                               
|Cash dividends paid                                         |                               
|Return of capital                                           |                               
|                                                            |                               
|Net cash provided by (used in) financing activities         |                               
|                                                            |                               
|Increase in cash and cash equivalents                       |                               
|Cash and cash equivalents at beginning of year              |                               
|                                                            |                               
|Cash and cash equivalents at end of period                  |                               
|                                                            |                               

4

TRANSAMERICA FINANCE CORPORATIONCONSOLIDATED STATEMENTS OF RETAINED
EARNINGS(Dollar amounts in millions)

|                             | Nine months endedSeptember 30,
|---------------------------- | ------------------------------
|
|                             |                               
|Balance at beginning of year |                               
|Net income (loss)            |                               
|Dividend declared and paid   |                               
|                             |                               
|Balance at end of period     |                               
|                             |                               

Item 2. Managements Narrative Analysis of Results of Operations

The following tables set
forth revenues and income (loss) by line of business for the periods indicated:

|                                      | Nine months ended September 30,(Dollar amounts in millions)
|------------------------------------- | -----------------------------------------------------------
|
|
|                                      |                                                            
|Commercial lending                    |                                                            
|Intermodal leasing                    |                                                            
|Real estate information services      |                                                            
|Other                                 |                                                            
|                                      |                                                            
|                                      |                                                            
|                                      |                                                            
|Amortization of goodwill (net of tax) |                                                            
|                                      |                                                            
|Income (loss) before cumulative       |                                                            
|effect of accounting change           |                                                            
|Cumulative effect of accounting       |                                                            
|change                                |                                                            
|                                      |                                                            
|Net income (loss)                     |                                                            
|                                      |                                                            

|                                      | Three months ended September 30,(Dollar amounts in millions)
|------------------------------------- | ------------------------------------------------------------
|
|
|                                      |                                                             
|Commercial lending                    |                                                             
|Intermodal leasing                    |                                                             
|Real estate information services      |                                                             
|Other                                 |                                                             
|                                      |                                                             
|                                      |                                                             
|                                      |                                                             
|Amortization of goodwill (net of tax) |                                                             
|                                      |                                                             
|Net income (loss)                     |                                                             
|                                      |                                                             

5

Commercial Lending

Commercial lendings
income from operations for the first nine months and third quarter of 2001 were
$69.1 million and $24.7 million compared with losses of $45.9 million and $62.3
million, respectively, for the corresponding periods of 2000. Operating results
for the first nine months and third quarter of 2001 included after tax losses of $2.3
million and $2.1 million, respectively, resulting from the mark to market of its
stock warrant portfolio, which is accounted for as a derivative instrument under
Financial Accounting Standards Board (FASB) Statement No. 133,
Accounting for Derivative Instruments and Hedging Activities (FAS
No. 133). In addition, operating results for the first nine months of 2001
included $3.2 million in after tax gains resulting from the sale of a portion of
stock received from the exercise of stock warrants. During the first nine months
and third quarter of 2001, the commercial lending operation sold approximately
$770 million and $320 million, respectively, of retail net finance receivables,
which resulted in after tax gains of $7.7 and $0.7 million, respectively. Also,
during the first nine months of 2001, the commercial lending operation recorded
an after tax gain of $1.2 million from the sale of certain assets of the
insurance premium finance business. In connection with the insurance premium
finance asset sale, a decision was made to liquidate the remaining insurance
premium finance net finance receivables and reclassify the net carrying value of
those receivables from assets held for sale to net finance receivables.

Operating results for the
nine months and third quarter ended September 30, 2000 included a charge of
$231.6 million ($159.2 million after tax) and $153.2 million ($101.2 million
after tax), respectively, resulting from the decision to exit the consumer
mortgage and insurance premium finance businesses in the second quarter, and the
retail finance and small business administration loan businesses in the third
quarter. The provisions were primarily for the write-off of related goodwill and
for the reduction of the net carrying value of the related net finance
receivables portfolios to their estimated realizable value. The net finance
receivables of these operations totaled $2,043.3 million and were reclassified
to assets held for sale. During the third quarter of 2000, the commercial
lending operation sold $536.1 million of consumer mortgage receivables at their
net carrying value. Also included in the results for the first nine months and
third quarter of 2000 were after tax gains of $12.3 million and $0.7 million,
respectively, from the sale of a portion of stock received from the exercise of
stock warrants. Operating results for the first nine months of 2000 included a
$1.7 million after tax charge resulting from the accelerated amortization of
premiums upon the termination of the $150.0 million retail revolving credit card
securitization.

Excluding the items discussed
above, commercial lending income from operations for the first nine months and
third quarter of 2001 decreased $43.4 million (42%) and $12.1 million (32%) from
the comparable prior year periods. The decreases were primarily due to higher
credit losses in the transportation and technology portfolios and reduced
earnings as a result of reductions of net finance receivables in the assets held
for sale and liquidating portfolios.

Revenues for the first nine
months and third quarter of 2001 decreased $103.2 million (11%) and
$67.3 million (22%) from the corresponding periods of 2000. The decreases were
principally a result of the sale and liquidation of net finance receivables in
the assets held for sale and liquidating portfolios and lower lending rates
resulting from a decline in the interest rate environment. Additionally,
revenues in the first nine months of 2001 included $5.0 million of gains on the
sale of a portion of stock received from the exercise of stock warrants. No
gains were recorded in the third quarter of 2001. The first nine months and
third quarter of 2000 had stock sale gains of $19.6 million and $1.2 million,
respectively.

6

Interest expense decreased
$68.1 million (18%) and $47.0 million (37%) for the first nine months and third
quarter of 2001 due primarily to lower borrowing rates and lower average debt
levels related to the decline in average net finance receivables in the assets
held for sale and liquidating portfolios. Operating expenses for the first nine
months of 2001 increased $18.7 million (6%) compared with the first nine months
of 2000 primarily due to costs associated with the runoff of the held for sale
and liquidating loan portfolios. Operating expenses for the third quarter of
2001 were relatively constant with the prior year third quarter. The provision
for losses on receivables for the first nine months and third quarter of 2001
increased $18.2 million (22%) and $1.3 million (5%) from the corresponding
periods of 2000 principally as a result of increased credit losses and higher
non-earning finance receivables in the transportation and technology portfolios.
Credit losses, net of recoveries, on an annualized basis as a percentage of
average net finance receivables outstanding (average net finance receivables
outstanding include receivables classified as assets held for sale), were 2.12%
for the first nine months and 2.32% for the third quarter of 2001 compared with
0.52% and 0.49% for the comparable periods of 2000.

Net commercial finance
receivables outstanding at September 30, 2001 decreased $981.9 million (12%)
from December 31, 2000. The decrease was primarily due to lower volume caused by
the general downturn in the economy along with the seasonality impact in the
distribution finance portfolio. Management has established an allowance for
losses on net finance receivables of $155.8 million (2.09% of net finance
receivables outstanding) at September 30, 2001 compared with $158.9 million
(1.88% of net finance receivables outstanding) at December 31, 2000.

Delinquent finance
receivables consist of the installment balance for inventory finance and
asset-based lending finance receivables more than 60 days past due and the
finance receivables balance for all other receivables over 60 days past due. At
September 30, 2001, delinquent receivables were $157.6 million (1.92% of finance
receivables outstanding) compared with $128.5 million (1.38% of finance
receivables outstanding) at December 31, 2000.

Non-earning finance
receivables consist of balances from borrowers that are more than 90 days
delinquent for non credit card receivables or at such earlier time as full
collectibility becomes doubtful. Non-earning finance receivables on revolving
credit card accounts consist of balances from borrowers in bankruptcy and
accounts for which full collectibility is doubtful. Non-earning finance
receivables were $243.0 million (2.95% of finance receivables outstanding) at
September 30, 2001 compared with $193.9 million (2.08% of finance receivables
outstanding) at December 31, 2000. The increase in delinquent and non-earning
finance receivables was primarily in the transportation and technology
portfolios.

Assets held for sale at September 30,
2001 totaled $389.5 million, net of a $118.7 million valuation allowance, and consisted
of retail finance, consumer mortgage and small business administration net finance
receivables and other repossessed assets. During the first quarter of 2001, insurance
premium finance net finance receivables totaling $113.8 million were reclassified from
assets held for sale to net finance receivables in connection with the sale of certain
related assets and the decision to liquidate the remaining portfolio. Assets held for
sale at December 31, 2000 totaled $1,130.1 million, net of a $125.1 million valuation
allowance. Of the net finance receivables held for sale at September 30, 2001, $59.3
million were more than 60 days past due and $62.1 million were classified as non-earning.
At December 31, 2000, delinquent and non-earning were $78.1 million and $57.2 million,
respectively.

Intermodal Leasing

Intermodal leasing financial
results for the first nine months and third quarter of 2001 reflect the
operations marine container and European trailer businesses. In the second
half of 2000, the operations tank container and domestic products
businesses were sold.

7

For the first nine months and
third quarter of 2001, the intermodal leasing operation reported losses from
operations of $16.0 million and $4.7 million, respectively, compared with income
of $9.4 million and a loss of $1.6 million for the first nine months and third
quarter of 2000. A $2.4 million after tax gain resulting from the termination of
certain forward exchange contracts favorably impacted earnings for the first
nine months of 2001. Income from operations for the first nine months of 2000
included a $9.5 million net tax benefit associated with a structured financing
of certain European trailer equipment, a $6.5 million after tax valuation
provision on certain European trailer equipment and a $3.2 million after tax
gain on the third quarter of 2000 sale of the tank container business. Excluding
these items and operating income from the sold tank container and domestic
products businesses, operating losses for the first nine months and third
quarter of 2001 remained relatively constant compared with the corresponding
periods of 2000.

Revenues for the first nine
months and third quarter of 2001 decreased $176.7 million (35%) and
$55.1 million (34%), respectively, compared with the first nine months and third
quarter of 2000. Included in revenues for the first nine months and third
quarter of 2000 are a $10 million valuation provision on certain European
trailer equipment and a $5 million gain on the sale of the tank container
business. Excluding these items and operating revenues from the sold tank
container and domestic products businesses, revenues decreased by $19.9 million
(6%) for the first nine months of 2001 and $9.0 million (8%) for the third
quarter of 2001 over the corresponding periods of 2000. Revenues for the first
nine months and third quarter of 2001 decreased primarily due to lower on-hires
and per-diem rates for maritime containers resulting principally from a
weakening global economy.

Expenses for the first nine
months and third quarter of 2001 decreased $152.2 million (30%) and
$50.6 million (31%), respectively, from the first nine months and third quarter of
2000. Excluding operating expenses related to the sold tank container and
domestic products businesses, expenses for the first nine months and third
quarter of 2001 decreased by $19.1 million (5%) and $4.1 million (3%),
respectively, relative to the comparable periods of 2000. The decrease in the
first nine months and third quarter of 2001 was attributable primarily to lower
ownership costs resulting principally from lower borrowing rates.

Marine container utilization
averaged 74% and 73%, respectively, for the first nine months and third quarter
of 2001 and 77% and 79%, respectively, for the first nine months and third
quarter of 2000. European trailer utilization was 88% and 88%, respectively, for
the first nine months and third quarter of 2001 and 82% and 83%, respectively,
for the comparable periods of 2000.

Real Estate Information Services

Real estate information
services provides property tax monitoring, flood certification, and other real
estate information services to its customers. The largest component of this
operation is the tax monitoring business, which provides tax monitoring services
to mortgage lenders nationwide. Real estate information services income from
operations for the first nine months and third quarter of 2001 was $29.2 million
and $6.4 million, respectively, compared with $16.6 million and $6.9 million for
the comparable periods of 2000. In August 2000, the operation contributed its
Intellitech business in exchange for a 41% equity interest in First American
Real Estate Solutions, L.P. (FARES). In September of 2000, the
operation sold 51% of its remaining interest in FARES for $22.5 million, which
resulted in an after tax loss of $1.7 million for both the nine months and third
quarter ended September 30, 2000. Income from operations for the first nine
months of 2001 included a $13.0 million after tax gain from the reversal of a
current state tax liability accrued, but never incurred, while operating as a
division of Transamerica Corporation. Excluding these items, income decreased by
$2.7 million (15%) and $2.5 million (29%) for the nine months and quarter
ended September 30, 2001 as compared with the corresponding periods of 2000,
primarily due to higher expenses associated with increased tax monitoring
service volume.

Real estate information
services revenue decreased by $26.5 million (13%) during the first nine months
of 2001 and $7.9 million (12%) for the third quarter of 2001 from the comparable
prior year periods. The contribution of the operations former Intellitech
business to FARES in August of 2000 resulted in decreased revenue of $27.0
million and $7.0 million for the first nine months and third quarter of 2001,
respectively.

8

Operating expenses decreased
$18.0 million (11%) for the nine months ended September 30, 2001 and remained
constant during the third quarter as compared with the corresponding periods of
2000. Excluding expenses related to the Intellitech business, expenses increased
$5.4 million (4%) for the nine month period and $3.3 million (8%) for the third
quarter of 2001 primarily due to increased operating expenses associated with
increased tax monitoring service volume.

Other

Other consists primarily of
miscellaneous income, unallocated interest, the fair value adjustments to debt
derivatives that do not qualify as hedges under FAS No. 133 and other expenses.
The increase in income for the first nine months of 2001 as compared with the
corresponding period of 2000, was primarily related to reversal in the second
quarter of 2001 of a $9.8 million after tax deferred state income tax liability
that was no longer required. The reversal was the result of a revaluation of the
current consolidated state income tax position of the Company as a result of
Aegons acquisition of Transamerica and the relocation and reorganization
of the Company. Results for the first nine months and third quarter of 2001 also
included after tax charges of $1.7 million and $1.5 million, respectively,
relating to the fair value of debt derivatives that do not qualify as hedges
under FAS No. 133.

Comprehensive Income

In accordance with FASB
Statement No. 130, Reporting Comprehensive Income, comprehensive income
for the nine and three months ended September 30, 2001 and 2000, comprised
(amounts in millions):

|                                               | Nine months endedSeptember 30, | Three months endedSeptember 30,
|---------------------------------------------- | ------------------------------ | -------------------------------
|
|                                               |                                |                                
|Net income (loss)                              |                                |                                
|Other comprehensive income (loss), net of tax: |                                |                                
|Change in net unrealized gains from            |                                |                                
|investments marked to fair value               |                                |                                
|Foreign currency translation adjustments       |                                |                                
|Change in unrealized gains from derivatives    |                                |                                
|marked to fair value                           |                                |                                
|Cumulative effect of accounting change         |                                |                                
|                                               |                                |                                
|Comprehensive income (loss)                    |                                |                                
|                                               |                                |                                

Derivatives

The Company uses derivative
financial instruments to hedge some of its interest rate and foreign exchange
rate risk. The Company uses interest rate exchange agreements and forward
contracts to hedge the interest rate risk of its outstanding indebtedness and
future commitments. The interest rate exchange agreements are intended to help
the Company more closely match the cash flow received from its assets to the
payment on its liabilities, and generally provide that one party pays interest
at a floating rate in relation to movements in an underlying index, while the
other party pays interest at a fixed rate. The Company also uses cross currency
exchange agreements, which fix by contract the amounts of various currencies to
be exchanged at a future date with other contracting parties and forward
exchange contracts whereby the Company agrees to sell to other contracting
parties at a future date a specified amount of foreign currency for a specified
amount of dollars.

9

The Company adopted FAS No.
133 as amended, on January 1, 2001. The adoption of FAS No. 133 impacted the
Company as a result of the transition adjustment to record the derivatives at
fair value and, to the extent the hedged items carrying amounts were
different from their fair value, an adjustment to the carrying amount of the
hedged items. To the extent that the hedged items were already recorded at fair
value or the adjustment to record the hedged items at fair value was less than
the transition adjustment to record the derivatives at fair value, there was an
income statement effect. Also, under FAS No. 133, stock warrants that the
Company receives in connection with its technology loans may be considered
derivatives. This derivative treatment requires the warrants to be recorded on
the balance sheet and then marked to market through the income statement. The
positive cumulative effect adjustment to net income of adopting this statement
was $7.7 million after tax. The adoption of this statement may add volatility to
the reported results of operations.

While the Company is exposed
to credit risk in the event of non-performance by the counterparty, the
likelihood of non-performance is considered low due to the high credit ratings
of the counterparties. At September 30, 2001, all of the interest rate exchange
agreements were with financial institutions with investment grade ratings of A
or better by one or more of the major credit rating agencies.

Debt derivative financial
instruments with notional amounts of $1.7 billion at September 30, 2001 and
$2.2 billion at December 31, 2000 were outstanding and designated as hedges of the
Companys liabilities. Of these debt derivatives, $1.2 billion at September
30, 2001 and $1.1 billion at December 31, 2000 qualified under FAS No. 133 for
hedge accounting treatment

The fair values of the
Companys debt derivatives at September 30, 2001 and December 31, 2000 were
net benefits of $17.8 million and $43.7 million, respectively. At September 30,
2001 and December 31, 2000, these debt derivatives contained aggregate gross
obligations of $8.2 million and $2.1 million, respectively, and aggregate gross
benefits of $26.0 million and $45.8 million, respectively.

Recent Accounting Pronouncements

Effective April 1, 2001, the
Company adopted FASB Statement No. 140, Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities
(FAS No. 140), that replaces, in its entirety, FASB Statement
No. 125, Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities. Although the statement has changed many of
the rules regarding securitizations, it continues to require an entity to
recognize the financial and servicing assets it controls and the liabilities it
has incurred and to derecognize financial assets when control has been
surrendered in accordance with the criteria provided in FAS No. 140. The
adoption of FAS No. 140 did not have a material effect on the earnings or the
financial position of the Company.

In July 2001, the FASB issued
Statement No. 141, Business Combinations (FAS No. 141), and Statement No.
142, Goodwill and Other Intangible Assets (FAS No. 142). These statements
significantly change the accounting for business combinations, goodwill and intangible
assets. FAS No. 141 eliminates the pooling-of-interests method of accounting for business
combinations except for qualifying business combinations that were initiated prior to
July 1, 2001. Additionally, FAS No. 141 further clarifies the criteria to recognize
intangible assets separately from goodwill. This statement is effective for business
combinations initiated after June 30, 2001.

Under FAS No. 142, goodwill
and intangible assets deemed to have indefinite lives will no longer be
amortized but will be subject to annual impairment tests in accordance with the
statement. Other intangible assets will continue to be amortized over their
useful lives. The amortization provisions of FAS No. 142 apply to goodwill and
intangible assets acquired after June 30, 2001. With respect to goodwill and
intangible assets already existing on that date, companies are required to adopt
FAS No. 142 in their fiscal year beginning after December 15, 2001.

10

The Company will adopt FAS
No. 142 as of January 1, 2002. Application of the amortization provisions of the
statement relating to existing goodwill is expected to result in a reduction in
expenses of approximately $15 million per year. During 2002, the Company will
perform the required impairment tests of goodwill and indefinite lived
intangible assets as of January 1, 2002 and has not yet determined what effect
the outcomes of these tests will have on its financial position and the results
of its operations.

In September 2001, the FASB
issued Statement No. 144, Accounting for the Impairment or Disposal of
Long-Lived Assets (FAS No. 144) that is applicable to financial
statements issued for fiscal years beginning after December 15, 2001. This
statement supersedes FASB Statement No. 121, Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Ofby
significantly changing the criteria that would have to be met to classify an
asset as held-for-sale. The new rules also supersede the provisions of
Accounting Principles Board Opinion 30 Reporting the Results of Operations
 Reporting the Effects of Disposal of a Segment of a Business, and
Extraordinary, Unusual and Infrequently Occurring Events and Transactions
(APB 30), with regard to reporting the effects of a disposal of
a segment or a component of a business and require expected future operating
losses from discontinued operations to be reported in discontinued operations in
the period(s) in which the losses are incurred, rather than as of the
measurement date as presently required by APB 30. As a result of the issuance of
FAS No. 144, the FASB expects that more dispositions will qualify for
discontinued operations treatment in the income statement. The Company will
adopt FAS No. 144 as of January 1, 2002. The company is currently assessing the
impact that adopting this statement will have on its financial position and the
results of its operations.

Safe Harbor Statement Under the Private Securities Litigation Reform Act
of 1995

The statements contained in
this report, which are not historical facts, are forward-looking statements.
When included in this report, the words expects,
intends, anticipates, estimates, and
analogous expressions are intended to identify forward-looking statements. Such
statements inherently are subject to a variety of risks and uncertainties that
could cause actual results to differ materially from those projected. Such risks
and uncertainties include, among others, general economic and business
conditions, competition, changes in financial markets (credit, currency,
commodities and stocks), changes in foreign, political, social and economic
conditions, regulatory initiatives and compliance with governmental regulations,
judicial decisions and rulings, and various other matters, many of which are
beyond the Companys control. These forward-looking statements speak only
as of the date of this Report. The Company expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any forward-looking
statement contained herein to reflect any change in the Companys
expectations with regard thereto or any change in events, conditions or
circumstances on which any statement is based.

Item 6. Exhibits and Reports on Form 8-K.

| | (a) |  | Exhibits.
| | --- |  | ---------

| |  | 12 | Computation of
Ratio of Earnings to Fixed Charges.
| |  | -- | --------------------------------------------------

| | (b) |  | Reports on Form 8-K.
| | --- |  | --------------------

| |  | None. | 
| |  | ----- | 

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SIGNATURES

Pursuant to the requirements
of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant
has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

| | TRANSAMERICA FINANCE CORPORATION
| | --------------------------------
| | (Registrant)                    

Pursuant to the requirements
of the Securities Exchange Act of 1934, this report has been signed below on
November 8, 2001 by the following persons on behalf of the Registrant and in the
capacities indicated.

|Signature                     | Title                                               
|----------------------------- | ----------------------------------------------------
|                              |                                                     
|Principal Financial Officer:  |                                                     
|                              |                                                     
|/s/ ROSARIO A. PERRELLI       | Executive Vice President and Chief Financial Officer
|(Rosario A. Perrelli)         |                                                     
|                              |                                                     
|Principal Accounting Officer: |                                                     
|                              |                                                     
|/s/ THOMAS G. BASTIAN         | Senior Vice President and Controller                
|(Thomas G. Bastian)           |                                                     

Date:   November 8, 2001

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